Posted by: Ray Brescia | March 7, 2013

Connecting the Myths of the Financial Crisis to Too Big to Jail

A recent issue of Bloomberg Businessweek ran the following cover:

There is so much wrong with this picture, it’s not clear where to start.  In my recent post on the Huffington Post, I discuss it, and talk about a recent study by the National Bureau of Economic Research that, although scholarly in nature, attempts something similar to what this cover does: perpetuate a myth about the causes of the financial crisis.  The Bloomberg cover, with its Griffith-esque caricature of people of color not far from their portrayal in Birth of a Nation, insinuates that they were to blame for the financial crisis.  The NBER study attempts to perpetuate a similar myth: that the Community Reinvestment Act was to blame for “risky lending” in the last decade.  A detailed response to this report is available here, as I mentioned in a previous post.

At the same time that these myths are being perpetuated, Attorney General Eric Holder is admitting that the big banks are, in effect, Too Big to Jail.  Is there a connection?  Are the myths of the causes of the financial crisis an additional reason law enforcement must cower before the big banks for fear of political–let alone perceived economic–fallout?

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